Current Account Adjustment and Financial Integration

The paper investigates whether higher financial integration leads in general to slower current account adjustments. The study estimates theoretically founded trade balance reaction functions for a panel of seventy countries from 1970-2004. The empirical analysis finds that adjustment in integrated economies is slower. Consistent with the presented theory the trade balance of integrated economies is more persistent, responds less strongly to net foreign assets, and is more sensitive to fluctuations in net output. A sufficiently strong response to net foreign assets is also a condition for external sustainability. Under high integration countries appear to stay close to the sustainability limit.current account adjustment, reaction function, financial integration, capital mobility

Limits of Floats: The Role of Foreign Currency Debt and Import Structure

A traditional argument in favor of flexible exchange rates is that they insulate output better from real shocks, because the exchange rate can adjust and stabilize demand for domestic goods through expenditure switching. This argument is weakened in a model with high foreign currency debt and low exchange rate pass through to import prices. We analyze the transmission of real external shocks to the domestic economy under fixed and flexible exchange rate regimes for a broad sample of countries in a Panel VAR and let the responses vary with foreign currency indebtedness and import structure. We find that flexible exchange rates do not insulate output better from external shocks if the country imports mainly low pass-through goods and can even amplify the output response if foreign indebtedness is high.Exchange Rate Regimes, Balance Sheet Effects, Pass-through, Interacted Panel VAR, External Shocks

Low interest rates and housing booms: the role of capital inflows, monetary policy and financial innovation

A number of OECD countries experienced an environment of low interest rates and a rapid Increase in real house prices and residential investment during the past decade. Different explanations have been suggested for the housing boom: expansionary monetary policy, capital inflows due to a global savings glut and excessive financial innovation combined with inappropriately lax financial regulation. In this study we examine the effects of these three factors on the housing market. We estimate a panel VAR for a sample of OECD countries and identify monetary policy and capital inflows shocks using sign restrictions. To explore how the effects of these shocks change with the structure of the mortgage market and the degree of securitization, we allow the VAR coefficients to vary with mortgage market characteristics. Our results suggest that both types of shocks have a significant and positive effect on real house prices, real credit to the private sector and residential investment. The response of housing variables to both types of shocks is stronger in countries with more developed mortgage markets. The amplification effect of mortgage-backed securitization is particularly strong for capital inflows shocks.Money supply ; Capital movements

Reserve Requirements for Price and Financial Stability - When Are They Effective?

Reserve requirements are a prominent policy instrument in many emerging countries. The present study investigates the circumstances under which reserve requirements are an appropriate policy tool for price or financial stability. We consider a small open economy model with sticky prices, financial frictions and a banking sector that is subject to legal reserve requirements and compute optimal interest rate and reserve requirement rules. Overall, our results indicate that reserve requirements can support the price stability objective only if financial frictions are important and lead to substantial improvements if there is a financial stability objective. Contrary to a conventional interest rate policy, reserve requirements become more effective when there is foreign currency debt.Reserve Requirements, Monetary Policy, Financial Stability, Capital Flows, Business Cycle.

Current account adjustment and financial integration

The paper investigates whether higher financial integration leads in general to slower current account adjustments. The study estimates theoretically founded trade balance reaction functions for a panel of seventy countries from 1970-2004. The empirical analysis finds that adjustment in integrated economies is slower. Consistent with the presented theory the trade balance of integrated economies is more persistent, responds less strongly to net foreign assets, and is more sensitive to fluctuations in net output. A sufficiently strong response to net foreign assets is also a condition for external sustainability. Under high integration countries appear to stay close to the sustainability limit

Limits of floats: The role of foreign currency debt and import structure

A traditional argument in favor of flexible exchange rates is that they insulate output better from real shocks, because the exchange rate can adjust and stabilize demand for domestic goods through expenditure switching. This argument is weakened in a model with high foreign currency debt and low exchange rate pass through to import prices. We analyze the transmission of real external shocks to the domestic economy under fixed and flexible exchange rate regimes for a broad sample of countries in a Panel VAR and let the responses vary with foreign currency indebtedness and import structure. We find that flexible exchange rates do not insulate output better from external shocks if the country imports mainly low pass-through goods and can even amplify the output response if foreign indebtedness is high

Human complement factor H. Two factor H proteins are derived from alternatively spliced transcripts

The human complement factor H is an important component in the control of the alternative pathway of complement activation. We have previously shown that at least three factor H homologous mRNA species of 4.3 kb, 1.8 kb and 1.4 kb in length are constitutively expressed in human liver. In addition, several factor Hrelated proteins have been detected in human sera using antibodies directed against the classical human factor H glycoprotein of 150 kDa.The structure of the additional polypeptides has not been shown so far. Circumstantial evidence suggests that the 1.8-kb mRNA might encode the 43-kDa factor H-like polypeptide. Here we report the isolation, characterization and eukaryotic expression of the first full-length cDNA representing the major 4.3-kb mRNA and the 1.8-kb mRNA of human factor H. We show that the 4.3-kb transcript encodes the 150-kDa-factor H glycoprotein and the 1.8-kb mRNA the 43-kDa factorH polypeptide. The identity of the two cDNA in a region of 1400 nucleotides suggests that the two factor H-related transcripts are derived from one gene by a process of alternative splicing

Protein phosphorylation in yeast mitochondria

We describe the identification and submitochondrial localization of four protein kinases and of their target proteins in derepressed yeast mitochondria. The activity of one of the kinases depends on the presence of cyclic AMP (cAMP). It is soluble and localized in the mitochondrial intermembrane space. Its natural target is a polypeptide of 40 kDa molecular mass, which is bound to the inner membrane. Besides this natural target this kinase phosphorylates acidic heterologous proteins, like casein, with high efficiency. The other protein kinases identified so far are cAMP-independent. At least one is localized in the matrix having its natural substrates (49 and 24 kDa) in the same compartment. Two others are firmly bound to the inner membrane phosphorylating target proteins in the inner membrane (52·5 kDa) and in the intermembrane space (17·5 kDa), respectively

Systematic screens of proteins binding to synthetic microRNA precursors

We describe a new, broadly applicable methodology for screening in parallel interactions of RNA-binding proteins (RBPs) with large numbers of microRNA (miRNA) precursors and for determining their affinities in native form in the presence of cellular factors. The assays aim at identifying pre-miRNAs that are potentially affected by the selected RBP during their biogenesis. The assays are carried out in microtiter plates and use chemiluminescent readouts. Detection of bound RBPs is achieved by protein or tag-specific antibodies allowing crude cell lysates to be used as a source of RBP. We selected 70 pre-miRNAs with phylogenetically conserved loop regions and 25 precursors of other well-characterized miRNAs for chemical synthesis in 3′-biotinylated form. An equivalent set in unmodified form served as inhibitors in affinity determinations. By testing three RBPs known to regulate miRNA biogenesis on this set of pre-miRNAs, we demonstrate that Lin28 and hnRNP A1 from cell lysates or as recombinant protein domains recognize preferentially precursors of the let-7 family, and that KSRP binds strongly to pre-miR-1-

Escherichia coli TatA and TatB Proteins Have N-out, C-in Topology in Intact Cells

The twin arginine protein transport (Tat) system translocates folded proteins across the cytoplasmic membrane of prokaryotes and the thylakoid membrane of chloroplasts. In Escherichia coli, TatA, TatB, and TatC are essential components of the machinery. A complex of TatB and TatC acts as the substrate receptor, whereas TatA is proposed to form the Tat transport channel. TatA and TatB are related proteins that comprise an N-terminal transmembrane helix and an adjacent amphipathic helix. Previous studies addressing the topological organization of TatA have given conflicting results. In this study, we have addressed the topological arrangement of TatA and TatB in intact cells by labeling of engineered cysteine residues with the membrane-impermeable thiol reagent methoxypolyethylene glycol maleimide. Our results show that TatA and TatB share an N-out, C-in topology, with no evidence that the amphipathic helices of either protein are exposed at the periplasmic side of the membrane. We further show that the N-out, C-in topology of TatA is fixed and is not affected by the absence of other Tat components or by the overproduction of a Tat substrate. These data indicate that topological reorganization of TatA is unlikely to accompany Tat-dependent protein transport